Premortems: Plan for the worst so you can avoid it

We all have found ourselves in situations where a business plan failed and we asked ourselves “how did we get to this point?” or “what were we thinking?” and wished that we had the chance to do it all over again.

This happens more often than not, especially when executives or teams get excited about a particular decision or initiative and rush to pursue it, without spending enough time and energy validating it. In some of those situations, you may even feel hostage of the most vocal and emotional members of a team, often times the executives themselves. They are really in love with that plan and they are selling you hard. Worse, they are detached from the execution details and you feel that you and your company are about to get stuck with an overly optimistic set of assumptions.

Conducting premortems before a big decision or a plan roll-out are the right and balanced antidote for those kind of situations. While they may not help prevent all screw ups from happening, they will improve the chances of a plan’s success.

Premortems have been studied by academia for a while, but it is only now that Universities like Stanford are recommending them widely, as a best practice for scaling businesses. I have attended a course by Stanford Professors Huggy Rao and Robert Sutton last week, which prompted me to write this article. This concept is also well covered in their most recent book “Scaling Up Excellence”. **

Here is how premortems works. You divide a team in two groups.

To the first group, you ask to imagine how success will look like in the future (be specific: 1,2 or 3 years) and to write the story of the journey to success, in as much detail as possible.

To the second group, you ask to imagine total disaster (such as out of cash, unsolicited turnover, investors up in arms,…) and to write the story of how the screw ups unfolded.

Both groups should avoid coming up with a list of bullets. The storytelling is actually part of the effectiveness of the exercise in visualizing scenarios as they unfold.

Once they are done with writing their respective stories, the team gets back together and each group reads their story aloud to the other group.

What follows is a review of the possible risk or success factors that may not have been accounted for in the initial plan and a prioritization of possible adjustments needed.

This exercise has several benefits:

Improved communication and empowerment: all members of the team get the chance to voice concerns that might otherwise go unaddressed until it is too late. They contribute to the validation of a big decision or action plan, without feeling that certain details or the ‘other side of story’ are being disregarded or trivialized.

Better understanding of a plan’s dependencies: team members will better understand how tasks entrusted to them are dependent on or influencing other tasks and contributing to a plan’s overall success or failure.

Early identification of possible reasons of failure: academic research has proven that visualizing possible failure can increase the ability to correctly identify reasons for future outcomes by 30%*.

Strengthening of a plan’s assumptions: following this exercise, it is very probable that a business plan is modified and corrective actions taken.

Given the high number of business plans that fail, slow down before you run, and consider adding premortems as part of your planning process. They will give your good entrepreneurial ideas better chances to succeed.

Be social and share this article so you can help reduce the number of… postmortems.

* Source: Harvard Business Review reporting on the work of Deborah J. Mitchell, of the Wharton School; Jay Russo, of Cornell; and Nancy Pennington, of the University of Colorado.